The Mumbai Zonal Unit of Directorate General of GST Intelligence has revealed an input tax credit (ITC) refund fraud case. The GST Intelligence team have successfully tracked down the promoter of seven companies that have applied input tax credit of around Rs 118 crores.
The Mumbai Zonal division of GST Intelligence, the investigation wing of GST, has reportedly arrested Santosh Doshi, who was governing and operating the cluster of seven companies Amal Overseas Pvt Ltd, C-Kluster Expotrade Pvt Ltd, Ekon Crystalmerchants Pvt Ltd, Meticulous Overseas Pvt Ltd., Ninad Overseas Pvt Ltd, Parees Overseas Pvt Ltd and White Opal Expotrade Pvt Ltd.
A Source in GST told Moneycontrol, the media outlet, “These companies fraudulently availed Input Tax Credit (ITC) without any supply of goods and services on the strength of bogus invoices and claimed Rs 118 Crore as refund against exports.”
The source further added, “The modus operandi involved in this financial fraud was that several dummy units were created in Jharkhand and West Bengal on the basis of forged documents. They passed on the said bogus ITC to several shell trading firms acting as intermediary entities situated in the State of Chhattisgarh. Further, several units were created as exporting fronts at Pune and Mumbai in the State of Maharashtra to whom the units situated in Chhattisgarh supplied fictitious goods purported to be exported.”
Another source associated with this case told Moneycontrol, “The exporting units were created merely for the purpose of availing refunds in a fraudulent manner. To nab the mastermind behind the whole channel of financial fraud, DGGI Mumbai launched an operation, by searching concerned CHAs, CAs, CSs, key persons and freight forwarders, and several statements were recorded. It was revealed that Doshi, a resident of Pune, Maharashtra, was actually the promoter and operator of these seven exporting firms. He is also the managing director of M/s Masumi Overseas Pvt. Ltd.”
Doshi was detained on August 17 and has been sent to judicial custody. Earlier too he was remanded by Mumbai customs in 2016.